Y Combinator Startup Podcast - #112 - Ryan Hoover and Dalton Caldwell

Episode Date: February 15, 2019

Ryan Hoover is the founder of Product Hunt which was in the Summer 2014 YC batch and was acquired by AngelList. He also invests in startups through his Weekend Fund.Dalton Caldwell is a Partner at YC where he runs admissions.Ryan is on Twitter at @rrhoover and Dalton is at @daltonc.The YC podcast is hosted by Craig Cannon.***Topics00:27 - Ryan's intro00:52 - Dalton's intro1:27 - Forming Product Hunt and applying to YC5:17 - Product Hunt's growth rate when they applied to YC6:27 - Raising money for the right reasons9:42 - Maker communities11:27 - Why raise money for Product Hunt?13:12 - Having buzz during the batch18:12 - Brex changing their idea during YC20:17 - Pivoting into something you know well21:32 - In retrospect, how would Ryan have advised himself around monetization?28:27 - Trying to build out other verticals34:27 - Don't act like you have infinite runway35:57 - Creating urgency and developing products within AngelList40:17 - Tips to launch on Product Hunt45:07 - What Dalton looks for in applications46:57 - Giving people the opportunity to start48:47- What motivated Ryan to leave his job before Product Hunt

Hey, how's it going? This is Craig Cannon, and you're listening to Y Combinators podcast. Today's episode is with Ryan Hoover and Dalton Caldwell. Ryan is the founder of Product Hunt, which was in the YC summer 2014 batch and was acquired by Angelist. He also invests in startups through his weekend fund. Dalton is a partner at YC, where he runs admissions. You can find Ryan on Twitter at R.R. Hoover and Dalton at Dalton C. All right, here we go. Welcome to the podcast, guys. How's it going? Doing well. How are you? Good. Good. All right, Ryan. So for those of our listeners who don't know who you are, what do you work on? So start a company five years ago almost, or actually just over five years ago, called Product Hunt. Places discover new products. You see a lot of makers and companies launching their new apps or their new products of the world. And kind of like Reddit or Hacker News, you have people commenting, asking questions and uploading what they think is most cool. And Dalton? I'm Dalton. I'm a partner at Y Combinator. I'm also the head of admissions. So that's the selection process for

for who we fund. And I actually worked at YC when Product Hunt was in YC. And so I remember it from the inside, kind of what the story was. Were you there for the interview? I was not. I did not interview him. Nope. Do you remember who it was? Yeah. It was Sam. Who else was it? It was it was 10 minutes of just rapid fire questions. And I was like, all right. Anyway, I can't remember who else it was. Yeah. Anyway, all right. Cool. Yeah. So Dalton, I think he has a question for you to started off. Yeah. So maybe to start with, like, because I remember it so well, um, from being there, walk me through from the formation of product hunt into applying to YCE into getting into that interview that is already a blur. You're not sure it was there.

Um, was I there? I don't even know. Yeah. Um, that's a very common thing, by the way. It's almost like an out of body experience. People don't remember them that well. Uh, so it's not just, You. I hear that a lot where they there's a lot of anxiety when you go into it, frankly. And, and you know, you try to, well, someone gave me this advice actually during YC is before you do anything like that, before you do a pitch, pump your chest physically. It might have been Kevin Hale that said this. Yeah, I could be wrong. So sorry, Kevin, if I'm putting words in your mouth, but there's a step where you can like pump your chest physically and that act of physical nature of like doing something that feels like a little bit aggressive can inspire some confidence in a

you know, it's actually, I may have done that a few different times, you know, throughout my career. I'm not going to lie. I've never heard that device before. Yeah, that was, okay. That was Jordan Peterson's first rule in his book. It says, stand up straight with your shoulders back. Ah, anyway. All right.

Okay, so you blacked out during the interview, basically. But yeah, what else was that process like? Yeah, so see, where can I start? So product time, I'll do the beginning really, really quickly. It started off as a side project, and it was right between startups. I was leaving another one. and kind of tinkering and interviewing at other startups. It started product time.

It started off as an email list, got some traction there. That then turned into a website. And we looked a lot of inspiration like Reddit and Hacker News and other communities. And like, how do you, what systems do we want to take inspiration from? How do we want people to engage? And so we built that. That got some traction. And it was probably four, I want to say four months after the email started and when the website was kind of operating.

It was still a side project. It was not incorporated. It was still like a thing I woke up every morning super excited about and found my mind continually 24-7 focusing on it. But I still didn't know what we wanted to turn it into. And then it was around the four-month time period. I actually got a DM from Nicholas from Algolia. They were in the previous YC batch. I interviewed them.

Oh, nice. That was a good pick. They're doing well. He DMed me and said, hey, Ryan, you know, a lot of people in YC are using product hunt. They're launching their products there. Gary Tan would love to meet you. Have you thought about joining YC? And it was the perfect time because I was sort of at the crossroads where I'm like,

well, what do we do with this? You know, we could keep doing it as a side project. We could make it a company. If you make it a company, how do you build? Do you raise money? Do you not? So a lot of questions. So I initially said, oh, I'd love to meet Gary.

We went to the Grove on, I think, Mission Street. and my questions for Gary were pretty transparent. I was like, hey, Gary, this is working. Here are the numbers. I love doing this, but I'm not sure I want to take VC funding. And if I go into YC, if we do YC, does that mean we're on that path? And Gary said something along the lines of like, well, when you strike lightning in a bottle, that doesn't happen very often.

And I say that not arrogantly, it's not that like product is the most amazing best thing in the world. It's not. But very few times in your life do you build something that is like, Wow, there's something there. That is true. And that advice stuck with me. And Gary was not ever, he would never pressure me to say, you should do YC or you should raise EC funding.

But that, that advice or that feedback was really insightful because he's right. It's like, am I ever going to have a time in my life where I build something that is starting to show some sort of traction? That's something that people want ultimately. Do you remember what the growth rate was when you applied to YC? Yeah, we, if I'm not mistaken, I think we were like 50% month over month. And that's not counting with 100 users in month one, but it was like over the course of a few months with some users. And so it was and actually going into the interview, I'm fast forwarding a little bit.

But we found out some things that worked on the growth side. And a lot of it was very manual, me basically emailing makers and founders and tweeting at them. And I found out that when I messaged them, they would join the conversation, they would share and that would drive more traffic to the site. And so there's a nice flywheel effect that still exists today. And when I discovered, when we discovered that, I was like, well, shoot, let me just do that more often. And let me do that as fast and as quickly as I can going into the interview so that I can say honestly in the interview, yeah, we have 50% month over month growth in the past like three months. And so anyway, that was having those types of metrics gave me a lot more confidence. You know, I didn't have to pump my chest or maybe I should have.

But I didn't have to pump my chest to feel confident going into the interview, even though it was kind of anxiety inducing because it's such a quick process. Yeah, I've had similar conversations with folks, like the one Gary had with you. And sometimes what I do is actually discourage someone from doing venture financing if they have a side project working, especially if they're making money and they never will have, like, they can support themselves on it. And they can basically have the job forever. And you have this like cool freedom that so many people dream of. I'm sometimes like, hey, like, keep doing that. Like you're living the dream. The grass is not greener on the other side.

And if you do want to decide to raise money, just make sure you're doing it for the right reasons that you're really excited about it, not that someone told you to or you're seeking approval from authority figures. You know what I'm trying to say? Like you wanted to come. And so it sounds like what was good in your case

is you were like very on board versus, again, sometimes you see people being pushed down this path where they have something working. And then they regret it in the future. because they gave away a good job, right? Or a good lifestyle. I mean, it's this weird thing, right? Where you think like startup equals software, right?

So like because I'm making profitable software, therefore it is a startup. But it can equally be a small business. Yeah. Semantically, you can call it a startup too. Maybe it's like the VC line in the sand. It's not for everybody. And especially like I really respect there's so many great indie software developers building like Mac software.

And like they make a good living and like, I think they have a lot figured out that other people don't. And so those people, I'm like, yeah, I don't know if this is, I think you keep doing what you're doing. Yeah, that's the thought process that went through my head. And so there was a scenario and I was trying to imagine, well, let's see. First off, I didn't have much shin savings and I'm not an engineer. And so that was one of the things is, well, I need people to help me to build this thing and build out this roadmap that I have in my brain. and and so one way to do that is you get money to pay them well how do you get money you could do it

through VC or you can you know make money in the product itself you know there's other other means to get money but I was certainly evaluating well what if we never raise VC money what if I could pocket $20,000 in my pocket per month when they're great percent of the business that'd be amazing and isn't that what wirecutter did do you know do you know the wirecutter folks yeah didn't they bootstrap it off the affiliate links and yeah never raised it is that right yeah I It's possible. I don't know if Brian and team raised, maybe they did a friends of family,

I'm not certain, but they never raised like a real VC full round. Yeah. And that's 30 million? Yeah. He did very well. Yeah. Yeah.

Yeah. Yeah. Yeah. Yeah. Yeah. And even look at what Gabe's done with the tech meme, which has been around forever. Yeah.

You know, it's been, it's basically a force and like a thing that everyone in technology knows about. I use it every day. Yeah. And he doesn't, he hasn't raise money. And if he did raise money,

the product would change dramatically. They'd have to figure out, they'd have to figure out a lot of things to change it from what it's today. Probably have to throw conferences. That would be my guess. I've actually talked to him about this. So yeah, I don't think that would be his first choice, but.

Yeah. I don't think. It doesn't seem like the conference kind of guy. It does not. No. This is a little bit of a tangent, but what did you think of when indie hackers started to come up? Because that was a little bit after product time and is very similar,

and it's within this exact niche. Yeah. Yeah. I've been thinking more and more about, in my head, I describe it as like maker communities. And I would put, you know, pro-totent in that category, indie hackers, L-Path is certainly one of those, and a bunch of others.

And there are sort of communities that are designed and some of them are verticalized around a specific function or whether it's like dribble for designers, stack overflow for engineers, or it's demographic base, like L-Path for women. And there's like this whole ecosystem of maker communities in the internet. And I find it really fascinating because it's large. builds into the thesis of productant, which was always, well, I love discovering products. There's like this cultural relevance and interest within products and technology. And more and more people are building products.

In fact, in the next five years, we're going to see a ridiculous number of products being built, partly because it's more accessible. It's easier. You don't actually need any money to build anything. Anyone with the motivation and internet access can, like, build something. So I'm going off on a tangent a little bit now. But I see Indy Hackers is certainly fill in. this sort of niche in this focus around like bootstrapped entrepreneurs and that's like their

focus within this kind of maker community ecosystem for me. And what Cortland's done is is great. I've, you know, I've participated in the community. I've been on this podcast. I'm seeing him tonight actually. Which is funny. But yeah, I love what they're doing. Okay. But not all companies that go through YC ultimately raise money afterward, right? Like Zapier is a good example. That is correct. Yeah. Right. And so, and they predated product hunt, right? So, I think kind of what Dalton was alluding to. So you had this point where you could have raised money or could have not raised money. And so Demo Day, why do you decide to follow that path?

Yeah. So the story with us going through YC, so we raised around the same time we got into YC. And part of the strategy was one, we're building something for the tech community. And strategically it was important or rather beneficial for us to get a lot of notable tech people involved. So we raised money from like GV, Greylock, SV Angel. They were the first check-in, a bunch of other like strategics. And having them involved was just helpful to have like the support community. And granted, we probably gave up more equity than we needed to.

We raised a million before like going into YC before Demo Day when we were targeting like 400K. But we got great people around us. And then fast forward through Demo Day, Mark and Driesen reached out kind of in the middle. And he'd been following it and was. interested and we met up and that happened. And then three or four weeks later, he contacted again and this was pre-demo day. And it was sort of, you know, how are things going? And I knew what that meant. You know, they were interested in long story short, they ended up doing a series A preemptively. Like we were pretty early, especially for injuries and warts to do that, that type around. But the,

the metrics are great. The vision or rather the opportunity massive. And I felt that it was, it was better to, you know, work with a great firm and raise more capital now than risk in six months raising with maybe not as good of a firm with maybe not as strong of numbers. And that money then would allow us to continue for several years, you know, building the company and hiring and building out what I want to build. And so I think my perspective working at YC is your experience was 100% a side effect of the lightened in a bottle effect you had and is not at all representative with 98% of the people in YC.

That is just not how it happens. And the reason is people don't have buzz or excitement. And because you're a community, they were participating in the community. And so it was very hard in that era, you know, everyone was using your site. And so you see these things sometimes when there's social products that take off. Everyone is on them all the time. I mean, I'm not going to, yeah, I can think of where there was like big things that were hot. And then everyone got excited about them.

But like it's fascinating hearing you say that because like, Seriously, that is no one's experience. Like, that is like 1% of the batch has that experience. And the other thing that I would say is like those aren't always correlated with the companies that like do really well in the long term. I'm trying to say it in a nice way. But like when you see these and it's usually because someone has like a hit on their hands. And so all the investors like circle around and do all this extra work to do it. But if you look at like a great example I like to talk about is Coinbase.

like he couldn't raise from anyone. I think he got like half a million bucks. Yeah. Is that 2013? Winter, summer 12, summer 12. Oh, wow.

And so like there's companies like coin maze were like, they couldn't get people to return their phone calls. And like couldn't, I think couldn't put together that much money. And, you know, like as a long term investment, wouldn't you love to be an investor in that?

You know, like I was like, I think the price was pretty good. And so we, so what we see from our side of the table on YC is like, excitement around the core product or feeling like other investors are excited about it and things like that definitely give a founder like yourself tons of leverage. But that I actually have learned to not take that too seriously as an investor as a signal for how the company will do.

It's more just like, oh, you know, like people like scooters or something. You know, there's other examples of these hype cycles happening. Yeah. And to try to like remember that it's the long term thing. things that really matter. Like retention and growth and revenue and those are those are super predictive at Demo Day. So anyway, I just like I remember that too when you were, everyone was like so excited

about product hunt and everyone wanted to work with you and they put tons of work into it. And like, yeah, other founders probably were like, why can't I be that? Yeah, I think I think part of the challenges is, you know, some of the best investments are somewhat contrarian. So Coinbase being a great example. in 2012, you know, crypto and that whole world was just like a totally different era. Yeah. And, you know, the best investments oftentimes.

And he was a single founder at the time, right? Oh, was he? Yeah, he was a single founder. Oh, really? When he was a demo day. Yeah, yeah. So it was like, Brian Armstrong, like, just Brian. Yeah.

And it was like, cool. Like, I'm the Bitcoin guy and I'm, it's just me. So like, he had a lot of, it was not a slam dunk at demo day for, for Coinbase. And it takes some conviction for like the future. The people that did invest saw a future. of crypto and what it could become. And so they placed a bet on him. And that's where I think maybe it gets challenging is if it's already super hot, then there's

probably also a lot of other companies competing for that same real estate. And I think maybe product is probably not the best example because we're not, it's not like a lift and Uber situation. It's not like we have a zero sum game when it comes to competition with other other companies. But yeah, I think that's true. And I've seen, you know, there's some, I'm trying to think back on the batch and who's, who's Yeah. What were you summer 14?

Summer 14, yeah. Yeah. So I think Ginko is extreme. Like they probably have hundreds of employees. They're, they're a biotech company. Again, like, I think they raised fine, but there was not this like hot buzz. Oh, Ginko BioWorks. They're from Boston. They're, you know, they're doing synthetic biology. Yeah. Like I don't think Mark Henderson was cold emailing them. Yeah. And so like who else was in summer 14? There were the nuclear companies. Remember the Octo and the fusion and the fission company were in summer 14? So there was like. Stuff like that, but it would be easy to forget. And this is also why what's fascinating working here, man, is people think that YC funds consumer companies. And this is what our bread and butter is. Yeah. And like, yeah, like, I think it's like 5% consumer.

Yeah. It's funny. People think that most of product hunt is actually consumer as well. Yeah. It's probably, I don't know, 50% at most is consumer. There's a lot of B2B stuff on there. Well, I mean, they're just the loudest. Well, but that's what I'm saying.

Everyone remembers, oh, product time. That makes sense. which like Reddit, like Dropbox, Airbnb. But man, if you actually look at the data, which is my job to do, a huge percentage is like good old-fashioned B2B enterprise. There's a lot of hard tech these days. And people just don't think about them. And it's not because they're not good businesses. They're less fun to talk about then.

And they just don't maybe like I don't understand biotech. It's less exciting for me simply for that reason because they just don't understand it. And you don't know where the market's going, right? Like when you think about Airbnb, you're like, oh, I could see myself doing that. Yeah. And then you just start doing it. So I'm curious, Don, about application surprises on your end because I think like both of you guys having done investments as well, you can understand like the market gets like really

frothy. And you're like, maybe I don't want to do that deal and I have to be principled. Or maybe you do do the deal and that's how it goes. What were the companies that we're like, I don't know about this? And then they went on to be like quite successful. Well, there's a lot of famous cases. people that we fund and then that end up pivoting into something wildly different. And that ends up being pretty good. And so my, my example that I had a front row seat for was Brex. I funded them to do

a VR headset thing. And I was, I was a credit card company. Yeah. Well, I didn't know that. And they, I was, I was, I interviewed them. I was their group partner. I was their main contact through the whole thing. And, you know, they, um, they didn't know a lot about VR headsets. I think they And, you know, it sort of came out during the batch and during office hours that, you know, perhaps they might want to consider something they knew more about. And they had prior built something sort of like strike for Brazil when they were younger. And so the idea was like, hey, maybe you should work on some fintech stuff that you know more about. And it was like, well, what should the product be? I'm like, well, what can you sell all the people in your batch?

Like you should talk to people where they want. Oh, like. And so the credit card thing just kind of came out. organically. That was like six weeks before demo day. Wow. And so there's no way you could have known that the folks working on the VR headset idea that didn't know much about hardware, we're going to end up being a pretty good

company. Yeah. So you were just surprised. That was very surprising. That was very surprising. Yeah. And right place, right time. You know, like there's lots of people that are super high caliber.

But that was one where certainly there was not a lot of hype about their VR headset idea. And they could have just gone all the way through it. And I don't, I think it would have been a struggle. Do you remember what that conversation was like? Because I think this is a, it's a super common question we get for the podcast. Yeah. People who change their ideas. What were those conversations like with them? What was the progress looking like? Did they even have a product? They did not. I think they ran into some pretty fundamental issues that they didn't know how to fix and they didn't know how to get around them. They hit, they hit a roadblock. And I definitely did encourage them to maybe in a very nice way to maybe. be like, why I always encourage people if they're thinking about maybe pivoting to go more towards something they're deep experts in that they know more about and not less about, right? And so you knew all about community, like you were in the right place for you and you still are. Right. So you, you want to find a good like cohesion of a founder doing something that plays to their strengths.

Sometimes people pivot into stuff that they know nothing about. And I'm pretty sure that is not correlated with success. It's, yeah. It's like if you try to pivot into biotech. Yeah. You'd be like, Oh, like biotech seems cool. Don't fund me. Yeah, product ton is like, product tends me in many ways, right or worse. And it's just what I love. I love products. And it's what me and my friends were doing.

And so it felt it was just fun. And actually, I tend to, when I talk to founders who are people who want to start a company, sometimes people overthink it. And they're like, I need to start a business. And I need to think about markets and everything. And I'm just, like, change your frame of mind. Think about it as an experiment or a side project. And when you put your frame of mind of like a side project, first, you start to,

you start to settle. Most people start to settle in, well, what would I want to build or what would I, what could I use? And it's just a lot better way to start, I think, personally. So do you think there's a way to play it over again where you could have, should have would have monetized or expanded faster? Because again, this is, especially if we're talking about non-venture funded things, it's not like a choice if you're bootstrapping about whether or not you tried for your product,

right? And so just like, where would you advise yourself? You know, say you have a time machine, you could advise your younger self. What would you have told yourself around monetization? It would have been like, you know what? Wouldn't change anything. Like, that's a valid option. Yeah, it's one of those things because there's a lot of mistakes I made, of course.

And so when I think about the mistakes, I think, well, I should have done it differently. And then there's another part of me, though, that thinks, well, with the information I had at the time, I probably still would have made the same decision. So the reality is I don't think things would have changed. And it's also hard to know if I did that, would that have actually been worse than what happened? And totally fair. So the things that I, I think we made a mistake on that I, I take responsibility for are a few different things. One of them, one of them is we should have dedicated a little bit of time and focus on revenue.

And in the beginning, before we were funded, we were, you know, I was paying the Heroku bill out of my own credit card. And it wasn't expensive, like a couple thousand dollars a month, maybe at one point. And I was like, well, I don't want to pay this. So let's like do job ads. Yeah. And so we did job ads and made like $4,000 a month. So not much. But like, there's clearly like very easy money.

Like with our community, it wouldn't have taken much work to make a little bit of money to increase our runway ultimately. The challenge is always, especially with consumer kind of focused startup is as soon as you start making money, then VCs will start judging you based on that revenue today. And so strategically, there's some challenges there, which is an unfortunate byproduct of, I think, how a lot of investors think. Yeah. For what it's worth, I would always tell someone, like to make that money. Like, I wouldn't judge someone for having small amounts of revenue. Yeah, if this was in someone's application, they're like, yeah, we're making this money from job ads. That would be like, cool.

Like, yeah, makes it very smart. Like, that would in no way cause me to me less psyched about the company if I read that in like an application or something. Yeah, I mean, I'm trying to think of a scenario where that would be hurting their company. Like, maybe it was affecting growth negatively somehow. Right. Like giant banner ads for jobs. And I feel like in a lot of media companies, what people end up starting with is affiliates. Yeah.

And so certainly that's how wirecutter works is like if you click on the thing and you buy it on Amazon, they get 3%. And it is very hard to build a huge, huge, huge company doing that. But it certainly helps when people are doing communities or things around discovery. That's a pretty tried and true way to pay the bills. Yeah. Yeah. Yeah. I think there's a difference between like a job board, but then if VCs, if investors perceive it is, well, that's the business model and that's the business model and that's the

mechanics of how you're going to make money. And if it's not impressive, then they'll be potential less excited. It's this weird, it's this weird game that you have to play. So one thing would be make money, extend runway, and start proving out some ideas early because making money takes a while. We focused on that last year and now we're profitable. And so that was like our number one goal is just, you know, let's cover our cost. And that just took a while, took a lot of experimentation to get there.

And a push on this again. I'm just picturing back in the batch. you kind of could have gone deeper on products, like really deep on just tech products and done like, I don't know, partnership. There's ways you could go deep on that. I remember there was ideas to expand to discovering other kinds of things. And like you can discover a game.

I don't remember the current status of that feature. Games is one of those. They was talking about diversification about the kind of stuff you discover. That's one way to do it. The other thing you've done is use the traffic you have and bootstrap things like a job board. or there's a scenario where you literally could have become angelist, right? Like you could have gone really deep on that. And so I can, I can like, it's your company, but I could pitch like five different scenarios

where you could have sort of zeroed in on what you were most excited about as a founder. And by going deep on those, it would become more evident if, you know, those are all wildly different companies I just pitched. But from that lightning and bottle that you had, you could have like gone deep on one of those. And it seems like your decision. was to stick with the core tech product thing and you wanted to be really thoughtful about your community. And I remember there's some redesigns. I don't know. Like, walk me through how you, like, when you had all these options on the table, strategically how you decided what was exciting to you and it was like,

yeah, we're not, I don't want to do a job or that sounds horrible. Which is a very good, you know, I think I would agree with you of that statement. But yeah, you could have. Yeah. Yeah. I mean, could have made very easily like 30K or something at some point, you know, a month without disrupting the user experience for that. You know, we, so I do remember the slide that it presented at Demo Day, actually, with sort of the long, I think it might have been the last slide, which was like the future vision, which was, okay, we're starting with tech. That's like our core. Longer term, we want to expand to gaming. I'm actually from the gaming world before all this. And so I've seen the challenges of game discovery for consumers, but also for people making games. And so. Yeah. Good about Steam.

Yeah. You could have done indie games. You know, like a platform, agnostic steam kind of community. Actually, that alone is a huge business on its own. Yeah. Fashion and like we even, I'm, I love music. I love discovering music. Like that's even an area. So we were thinking initially at one point like let's, let's build that's really, really amazing community initially. And then let's expand and replicate this model across multiple verticals.

And that actually still to me is super exciting. And like, yeah, I was so like, I remember the slide. I was like, wow, I'm like I was convinced, right? Yeah. This is definitely like because you had this initial kernel, it's so hard for founders that start where they can never get traction on the first product, then you can't be. creative. But you had, you had this, like, excitement and kernel and capital. And so, like, I was, like, super excited. I remember the demo day. I was like, man, I remember talking to you in, like, the green room or something. Yeah. I'm like, super psyched. Like, this is like, you know, like, I just

remember being really excited for you and like, being like, this is. Yeah. Well, there's a lot. Enjoy it. I think it's, I don't forget. I forget what I exactly said. It was like, yeah, but I remember seeing in the green room. Yeah. And everyone has like, you can imagine Venn diagrams. Everyone is, is interested in multiple things. Like, I love music. and I love games. I love tech. That's like my Venn diagram. Someone else might love fashion and beauty and tech.

And so the idea was like, let's take all these circles and like slowly expand like every kind of product category. And the learning though, there's a, I was a little bit naive, I think, in thinking that we could quickly replicate communities in these different verticals. And the nature of even just game discovery is quite different than product and tech discovery. And so in hindsight, we, we, we, tried to expand too quickly in the beginning. We didn't properly build like a core solid like gaming community. That was the first vertical we moved into. We did gaming. Then we did books and then we did

podcasts. Yeah. Because podcasts also suffer from a discovery in the community problem. Um, and it's very common YC application idea. Really? Oh, podcast everything. But definitely podcast discoveries in there. People send it to me every batch. What do you think of this idea? There's like, yeah. I mean, dozens of companies. Yeah. It's very common startup. Very hard. Very hard. And so, yeah, we learned what happened is we ended up having almost the entire community was still focused on tech and their frame of mind for using product. It was tech and tech products. And what resulted in just very little engagement in these other kind of side communities.

And we were unsuccessful in getting them spun up to be like their own standalone like community where people could, you know, find the best games or really visit on a daily basis for that type of content. Do you think you have a template now of how you may have done that in the past? like the right people to hire, maybe even create a new, like, name. It's not called product hunt anymore. Yeah.

Yeah, we internally talked about like game hunt and like expand, even buying hunt.com and like expanding out that way and kind of making it more general purpose. And I think this is one of the questions where it's, in hindsight, I would love to see how this would play out, but I don't know if it would work.

Yeah. And one scenario is we would build out separate domain entirely. And what that would afford us to do is create an entirely different experience design for gaming, which would be more visual, more videos, more imagery. It might, well, it would require people to have better ability to focus in the, the platform that they use, whether it's mobile or Xbox or PlayStation or whatnot.

And that's a very different experience in browsing. I feel like you're so good at community. I can just picture you could have used like really cool video reviews or you would have had like the equivalent of the maker. Like I can like see it, right? Like I guess it's part of my job. But like just you describe me and I'm like, yeah, that would be very different than all the other video discovery things.

And like that sounds really useful. Yeah. Right? There's nothing like that right now. And still, like, somebody should build it. What we're now focusing on is actually doubling. So that was one horizontal approach. Go really wide, build, you know, a network of properties potentially.

Instead, what we focus on is let's go deep. Because actually, as big as this is, this is also really big. Yeah, focusing entirely just on technology. Because who doesn't have an iPhone first off or like an Android phone? You know, there's some people in the world. But like more and more people are adopting just a smartphone in their pocket. That alone, every person that has a smartphone in their pocket, could be user or product hunt. It doesn't mean that we've designed an experience for everyone

today, but the market opportunity and, you know, the influence of technology is increasingly growing. So we've, we sort of honed in and, I don't know, three years ago probably honed in that direction and said, let's go deeper into technology and focus on that vertical and focus on our bread and butter instead of trying to spread so thin. Yeah, I mean, so going deep there, like sometimes people go up market where they're like, okay, we'll also do this thing for enterprises. And you could have helped people to discover enterprise software. And man, that sounds super lucrative.

Again, so I can't help but like brainstorming on the stuff. So I'm just thinking through, you know, back in the day when you have everything lined up and ready, were the things that you could have been excited about that were not selling out your vision of what it could be, but that would have like allowed you to to go super deep on this. Because again, you have resources now, but it's a different setup than if you were like trying to build a company that, you know, could employ a thing. thousand people or become the future of everything.

Yeah. So one thing that was suggested early, early on by a few of our investors, because their lens as an investor and investors were using Product Hunt to find and stay up to date what's cool. And a few different investors and people suggested, hey, you should start a product fund. Yeah. You should build a fund on top of Product Hunt, invest in, use the data in the community and

everything to source and find really early stage opportunities. And I was pretty adamant, as tempting as it is to explore that, because I've always been interested in investing pre-product hunt. I don't think it was the right direction. This is where I personally just don't think that was the right, that would have been the right outcome. It would have actually changed product dramatically into a much different type of business

and kind of be more like angelist potentially than. Again, this is what I was saying is like there was a way you could have, from your starting point, could have actually been angelist if you went down that path. Yeah. And so again, I'm not even saying it's the right one. There's also like Kickstarter. You could have been like, oh, let's help people like,

you know, imagine that you could, remember those experiments people did were if enough people took an action, it would unlock something launching. Do you remember that? There was like a hype machine did that a lot. A bunch of sites like 10 years ago did this stuff. Yeah.

But you would create collective action around people's launches and either help them actually sell products or monetize their products or get their initial user base. And I know you do beta testers, right? That's pretty cool. Aren't you already doing it? Yeah, we've experimented with some things. And then we sort of built a tool for people to collect beta users like emails and that kind of thing. Because like there's ways that instead of taking equity in companies, you still could have

provided like pretty deep services deeper than just click on my website and maybe sign up and like I think people would have happily paid for like for sure so anyway it's yeah it doesn't matter now but like I'm just like super fascinated on thinking through just what a great thing you had and all the ways like like I've been in Silicon Valley a long time and it's just like these little micro decisions that is a difference between you know Facebook being Facebook and my space or like sites we haven't even thought of like, I don't know, tagged. Remember that? And like high five. And like, I remember all these, like, I know the founders for all those companies. And like they were there. We were, you know, but little micro decisions have really huge effects over time. Yeah. And I'm fascinated by that. And I think part of it, this is a challenge going back to the money thing too. When you do raise a lot of money and you feel like you have infinite runway, you should treat it like you don't. And truthfully, there's some things that that I, I prioritized on the team because I want to. it myself, like some redesign work that we did, which redesigns are oftentimes a trap.

Like there's times when you want to do redesign work, but oftentimes it's realistically not going to change your numbers all that much. And especially with something like what we built, where we have a community of people, like people really don't care if the upfoot button looks a little bit shinier. Like they're going to use it or not because of the content, like the conversation and the people there. Remember all the dig redesigns? Yeah. Yeah. Yeah. Yeah. Although dig, I don't blame them for the 4.0, I think. I think release was the one that really had a problem. I think that direction was directionally like intuitive.

It was moving. It was when Twitter was taking off. And like how do you build sometimes even more accessible and builds more retention loops through following and that type of thing? I think there's some good ideas there, but it's hard. Communities are really hard too because. Oh, yeah. They don't like change. They don't.

They don't. And we've made changes that the communities has been upset about. And some cases we've reverted. Some cases we let them get used to it. Yeah. But I think this is a very real problem. Like a lot of venture back companies don't have that same sense of urgency that, you know, like Indie hacker type companies have. They're like, hey, listen, I could work on a redesign for the next month or I could like optimize my sales funnel and like make, you know, $100,000 more dollars. So now that you guys are within AngelLess, you could be a little more slack maybe. So like how are you creating that urgency? Like what are you focusing on right now? Yeah. So we have so last year and we have three KPI's actually that we. measure. Revenue is one of them. That was our number one priority last year. Not because we are running out of money. It's because we just want to build a model that can scale and cover our expenses. And so we hit profitability last year. Second metric was just user growth. How do we get more people using product hunt?

And the third is community contributions. And that's measured by the number of people upvoting, commenting, contributing. And that's important because it's basically the measurement of health. If we have nobody upfoting, then we have nothing. So we want to make sure that's good. And this year we're switching it around. Revenue is not the number one priority. We're switching towards user growth and we're focusing on kind of a couple different themes. One of them, one of them I can't share too many specifics on, but it's a lot about focusing on how do we help people find the best products or the products they should be using. So products that's always been about the new products. Come here, open up the website, you discover things that you never would have searched for because they

didn't exist yesterday. And it's kind of a place to get like a fire hose of new cool stuff. but a lot of people, in fact, probably more people in the world have a greater desire to find the best products for specific things. And it could be something like I switch from Android to iPhone. You know, what apps should I be downloading and using and exploring? Some of it might be, I'm starting a new company. What's the best analytics tool for this budget for these needs? So really focusing on on this and building out like a true product graph is kind of what we're moving towards. And so that's one theme.

Let's solve for that use case. And by the way, when we build products, we have a pretty good process down where we'll have usually one engineer to start with on it. And they drive the project forward alongside like Julie or Dan on the design side. And so we're able to like do a lot of projects at once, which some people might say is a bad thing. But for us, it works really well the way we're set up. And so that's one thing we have going on. Then we have going back to make your communities, we want to focus more on the social networking kind of side of product hunt and technology and making itself. And we've kind of experimented and dabbled with some of this, but we're starting to hone in on something that I think is going to work.

We'll see if it does around virtual co-working. And I don't think I've used those words publicly at all. But there's this, the people who are most engaged on product hunt are working on side projects. They're freelancers. They're remote workers. And they're just really curious and eager. And they have desire to, one, meet other people like them, get help from other people that are maybe have a different skill set, whether design or engineering. And also there's an aspect of loneliness, too.

If you're working on a project by yourself, and especially if you're not in Silicon Valley or like a tech hub, like where do you go? And so we want to build out ways for people to do all those things on product hunt and really support this like future maker kind of ecosystem going forward. Yeah, I see YC applications along those lines. It basically remote work is a big trend. And people are trying to think about tools and like any, there's a bunch of ways to attack the problem. but for sure, I'm very familiar with excitement around making it easier, better, faster for folks that are working remotely all over the world to work together and collaborate. Yeah, the tooling, I mean, we got Slack, but tooling wise, there's not a lot of.

Not much. I mean, Ryan and I both talked about this. We were both in long distance relationships. And he was like tweeting about it. Like, what are the solutions people are using? Yeah. It's super hacky. Tooling.

WhatsApp, FaceTime kind of stuff. But that's it. Yeah. Yeah. Yeah. Yeah. And there should be like this. The other realization is, I think some people forget, is most people also don't have a large following online, whether it's Twitter or Facebook or whatever. And when you're building something and you want feedback, at best, you ask your friends and your friends give you really terrible, positive advice because they don't want to hurt your feelings. And so there's, there's a greater need among this giant audience of people to have some sort of support network while they're building and exploring. Yeah. So I was curious about this. So there are a bunch of questions, basically people asking for. advice on like what makes a successful product on product hunt and like did you guys ever consider

going in that direction like more educational content for for your users yeah we mean we have FAQs and like how tos and things like that but we've never never really gone deep into the educational side because I think this kind of goes back to what we're saying like there's many different things that we could build for product hunt and as much as I'd love to help educate people it's not I think a core focus for us but yeah I think the general advice really when it come to like people ask me all time, what's the best way to launch a product hunt? Sometimes it's just simple advice.

Like make sure the imagery is really clear. The tagline is really clear. You know, bounce it off a few people that don't know you or don't know about your product and speak like a human, not like a marketer. You know what I'd love to hear about is an example of your favorite

company that's ever launched on product hunt that you're most proud of, almost like that you helped enable their success. And maybe the reverse, but I realize you can't. But just like, what's an example of, of no one specific, but just how someone can get to number one on product hunt and have a good launch.

And then actually, like, they didn't make so many people want and they churned everybody. And like what you've learned and internalized about someone with a great launch that in it sticks and they really go off into the stratosphere versus kind of like, oh, people checked out my silly thing. And then there's nothing there. Like, I'd love to hear thoughts on that. There's kind of a couple. There's two different things that come to mind. One more recent, actually. And this isn't a startup, actually.

It's not a company. But there's a number of, kind of self-describe like indie makers or people who are just eager to build things, not necessarily to make money. Sometimes they do. But sometimes it's just to build things and show it off and be creative and explore. And we do this thing called Golden Kitty Awards every year, which kind of nominates different products and different categories. And we have one category for like maker of the year. And we sort of take a look at all the efforts and some data from the past year to determine who that is. and I apologize, I might be forgetting his name, but it's Andre, if I'm not mistaken.

In Europe, he won Maker of the Year. And this is a younger guy who learned a code a few years ago, launched in his first product a couple years ago on Product Hunt after learning about 30 or 60 days. And then since then, he's just, he's almost like he's got the bug. He's got the bug to build. And I like to think that at least Product Hunt helped in some way in giving him feedback, because otherwise, when you build something, you spend all this time and know uses it, no one sees it. It doesn't mean that they have to use it forever, but like getting some

sort of feedback loops is so important when you're building something. He now has since built and launched tons and tons of different products. And I was happy to see like he won maker of the year and he even recorded the video, put it on Twitter and was like, thanks everybody. Like so happy. So there's like the sort of heartwarming, like it's great to have a tiny, tiny piece of in supporting these like future, well, these makers or maybe future founders of companies. But then going to a company example, one that really sticks to mind is Mirkat. Do you remember Mirkat back in the name? So I've gotten to know Ben.

I actually saw him last weekend, the CEO of Mirkat, now House Party. And Mirkat was such an awesome. It takes so many boxes that were like perfect in terms of the messaging was really clear. It was I think the tagline was something along the lines of broadcast live video to your Twitter followers. So it was very specific, actually. And the product design was built for leveraging the Twitter graph, which I think today still is underutilized, actually. And quickly it rose to problem and blew up. Everyone was using it for a little while. And the problem was the product itself was not retentive. And most people are really bad, including myself, at live video. It's just really hard to create good content. And to watch live video, you have to watch it when it's live, too. So there's like all these challenges with the product when it comes to retention and being something that works. But what they did realize kind of, within that is some people are sort of hacking it and using Mirket to hang out with friends.

And that's what ultimately like inspired house party, which is an app. You open it up and you and your friends immediately are in like a video chat. And you can just hang out and chat. And it's solving this like underlying desire of connection and being together with like people remote and your friends may be back at home or your girlfriend or whoever. And that was just like an interesting example because it blew up immediately. and yet at the same time, it required Ben and the team to be thoughtful and, like, honest with themselves. Like, they could have run out of money and run the company into the ground if they were persistent

in thinking that this would work, that Mirat would work as it is today. Instead, they had to change. That's really smart. And that's a great example we were talking about earlier, like, knowing where that decision point is. And it wasn't like a hard pivot where they did something radically different, but clearly, yeah. You know, I'm really curious now. Dalton, you've probably read, like, what, 10,000 after you? I read a lot of applications.

An infinite amount of all of the applications. Yeah. You know, I'm just kind of connecting the dots now, but like both of you guys basically like review products all year round. And I'm curious, like, how much time do you actually spend on product on in like in your YC application reading mind? Like, are you filtering through it in the same way? Or are you just curious about, oh, this is a cool side project. I'll try it out. I think the most important thing that I look at is how serious the founders.

are and if they really made something and showed it to people. And so it's almost like it doesn't matter if the product is good. So many people that apply aspirationally maybe want to build something someday possibly. But for the people that are serious enough to really make something and be brave enough to show it to other people and be willing to take all of the like, you know, it's really scary to do that. You know. And so when you see someone that's actually made something and they're willing to share it with the world and they show that commitment, but they're serious about it, I very much am paying attention to you. And I care less about like the scale of the revenue, like I was saying earlier. I care less about if the design is really good. Like those things are nice. But man, if the difference

between someone that's serious and not serious is all the difference in the world. Does that make, and so how do you evaluate that in applications? How do you know if they're serious? You can see if they've done something. Like, again, like, do you even, do you have a prototype? Do you have a first user? Have made a dollar of revenue. Like, again, it's very, it depends on the type of company it is, but you can see the difference between, hey, I want to raise money before I work on this. Yeah. That's a certain sort of thing. And that's not really our, are necessarily our bread and butter. And then the people that you can tell that they're going to work on their dream, no matter what, with or without you, and that you can hopefully help them in some way. And again,

I would put you at, you did it. Like, no one, like, no one told. you, hey, you should go make product hunt. You should make this email list. Like, you weren't trying, I don't think trying to please investors. You were just trying to do something you thought was cool. Yeah. And like that was the kernel of goodness that you had right. Like, you figure that on your own without authority figures telling you to do it. And like, that's really special. And that's a huge signal. Yeah. One thing I've been thinking a lot about is I was fortunate in that I had been working in a previous company for three years. After three years, I was like, I got to do something different. I gave notice that turned into a part-time role, actually. So cut my salary in half, work 20 hours a week. That gave me

plenty of time for product hunt. So I was lucky in that I could financially support myself as I was tinkering and building. And a lot of people just don't, especially in San Francisco. And I'm thinking more about this challenge. And maybe it's, I'd be curious if YC is thinking about this, but like, how do you, how do you give people that opportunity to quit their job and give them six months or 12 months, whatever the time is to do that? Because, you know, you can do a lot of nights and weekends and I think people underestimate that but there's also some people just have challenges and like having enough time to truly see something through without quitting their job yeah so in startup school which is the online course thing that we have anyone could participate you definitely don't

need to be full time um there's even for a small percentage of people that are really serious we give um I think this is all on our blog yeah yeah like there is how much do you give 10,000 10 grand yeah to everyone or just just certain things yeah I think we did 100 companies yeah oh wow So, you know, again, we can't be for everyone. But those are people where they were really serious. They were really working hard. And we, you know, that could be really helpful to them. And again, the whole point of startup school was like, even for people that haven't quit their job, it gives you a chance to be serious and structured in your thinking.

Right. Put on your calendar and make progress. There's so many people that want to start a startup. And whether or not they quit their jobs, they never like begin. Yeah. I mean, that's kind of what you were alluding to. A lot of people, man, would never even think about, I should go part-time. I should go 20 hours a week.

Like, a lot of people never get the confidence and never feel like they're good enough to do the thing. So, like, startup school is awesome there. But for you, like, what motivated you to be like, eh, you know what? I can do part-time. I can make this work. It was more that I just knew. I just knew deep and more hard that I needed to do something different because I felt like

I wasn't learning. And I love the company, love the team. but there's certain moments I think in everyone's career people who have worked with me that have transitioned out you know it's been a good transition because I saw like I get it like I know why you're leaving and I know why it's maybe not a good place for you anymore so for me I just I force myself and I initially was just going to leave entirely and not do part time and I was like I have a little bit of money saved I'll figure it out and maybe I was a little bit I don't know naive in that sense but it did work out and you know there's a reason

why I actually named the fund I started weekend fund though too because I think a lot of amazing companies and amazing things can be built on a weekend if you can afford the time. And I think a lot of people tend to now I don't want to, some people have families. Some people have financial burdens. There's like things like that that certainly are debilitating. But I think for a lot of people, there are no excuses not to be working on the weekend and like trying and making some progress. Yeah. Well, if you want to do a startup and not everyone, like it's not for everybody. But like if you're if you're curious, you have to start. And man, does that screen out a lot of people if they don't like start?

Yeah. Yeah. Yeah. And the progress too. There's something about as I speak with companies and look at now from an investor side a little bit, progress is like everything. And just even if it's, it doesn't have to be, you know, 50% month over month growth. But I've invested in companies after following them for even just two or three weeks, have given me more confidence based on what they're shipping and how they're interacting

with our users and those types of small micro like day-to-day interactions really matter a lot. Yeah. I mean, I think that's a great place to wrap it up. But yeah, thanks for coming in, guys. Yeah, thanks having me. Cool. Appreciate it. All right, thanks for listening.

So as always, you can find the transcript and the video at blog. Dot Ycombinator.com. And if you have a second, it would be awesome to give us a rating and review wherever you find your podcast. See you next time.